Treasury Secretary Paulson: U.S. may default uness $9 trillion debt limit raised by October

Treasury Secretary Henry Paulson on Monday said the United States may be unable to pay its bills this fall unless Congress raises the government's borrowing authority, now capped at $8.965 trillion.

Paulson, in a letter to lawmakers, estimated the government is likely to bump into the statutory debt limit in early October...

The administration, however, has defended the increases as essential to pay for wars in Iraq and Afghanistan and to cover other costs to keep the United States secure.

Separately, the government expects to borrow $73 billion in the July-to-September quarter, which would be more than previously forecast, the Treasury Department said.

The new estimate is $31 billion higher than a projection made in April. The department partly blamed increased government spending for the new, larger quarterly borrowing projection. It comes as the department considers the government's financing needs, which it does on a quarterly basis.

Read the rest at the Washington Post

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